CluenexStock prices are a bet on future profits, measured against what safe money pays. The economy moves both halves of that sentence.
1. Interest rates are the gravity
The 10-year Treasury yield is what investors can earn with no risk. When it rises, every future dollar of profit is worth less today, and the most expensive stocks fall hardest. The Fed steers short rates through the FOMC; markets set long ones.
2. Inflation decides the Fed
When Inflation runs above the Fed’s 2% goal, it raises rates or keeps them high. That is why a single hot CPI report can move the whole market in a morning, as on September 13, 2022.
3. Jobs decide spending
Consumers are about two thirds of the economy. Strong job growth supports profits, but can also keep inflation and rates up. Rising jobless claims are often the first sign of a slowdown.
4. Watch the warning lights
An inverted Yield curve and the Sahm rule have flagged past recessions. Neither is perfect: the curve inverted for two years from 2022 without a recession.
5. Markets move first
Stocks usually bottom months before unemployment peaks, and they price the Fed before it acts. That is why each Cluenex economy page shows how stocks did over the next 12 months, not on the day the news felt worst.